Fraud Prevention Hackathon results and next steps

24 Hours to Fraud Prevention

Fraud attacks in the insurance and financial services industry are increasing at a rapid rate. To help detect and prevent fraud, LIMRA and LOMA are teaming with members to develop resources in four key areas: Information, Research, Training, and Shared Solutions.

The first shared solution in development is a utility that will facilitate the exchange of fraud information between members, generate actionable alerts, and enhance their ability to prevent fraud. Our motto: Fraudsters share information — shouldn’t we?

Setting the Stage

On September 10–11, teams from six member organizations and LIMRA and LOMA convened in Windsor, CT, to participate in our first ever hackathon to realize this vision. Over 30 programmers and fraud experts from across the country participated in the 24-hour hackathon. Hackathons are incredibly effective at producing diverse solutions to a shared problem. Our hackathon was no different. Focused attention in copious amounts fueled great ideas.

From the start, the development of a fraud information-sharing solution has truly been an industry effort. In June, over 30 representatives from 30 member companies gathered at LIMRA headquarters to discuss their vulnerabilities and how to address them. A large-scale brainstorming session began to shape our fraud information sharing and alert system. These formative insights covered everything from valuable features to likely users.

Initial sketch in hand, we got to work. Fraudsters move fast but we needed to move faster. We gathered a group of member-company fraud experts to flesh out a proof-of-concept for the fraud sharing utility, including specific data inputs needed from member companies and the desired outputs to it truly useful.

Just three short weeks later, our seven hackathon teams commenced hacking! The mission: Design an online alert system that receives and analyzes fraud incident data from numerous companies and sends out real-time alerts based on a scaled rating system. Due to the evolving nature of fraud incidents and multiple attacks across organizations, system users also needed to be able to access historic details of fraud events. From there, teams were encouraged to go beyond baseline requirements and leverage their own ingenuity and creativity to apply analytics, design an interface, and more.

The Pitch

At the 22-hour mark, teams began pitching their ideas. The results were remarkable. Each pitch brought new features and a fresh take to the solution. It was a unique learning experience for everyone involved and kick-started the development of an industry solution. Here is what participants had to say about the event:

“The topic was of value to our entire industry, so being able to contribute to it was valuable for my company.”

“It was a great opportunity to work on a team towards a common goal. There is nothing like teamwork and mission!”

Unlike most hackathons, the teams did not simply produce vaporware — code never to see the light of day. The LIMRA LOMA Fraud Prevention Team examined the submissions and code and assembled the best ideas into a plan to develop a functioning prototype and ultimately an operational system for the industry. Stay tuned to loma.org/FraudSource for regular updates on this ground-breaking project.

Why, Oh Why?

Why are we going to all this trouble? Fraud is not only costly to firms but also financially damaging to consumers and society as a whole. Despite its importance, very little detail has been shared at the industry level. As an industry trade organization, our goal is to help our member companies collaborate to combat fraudsters.

Without an information exchange and alert system, companies are sharing fraud information via emails or conference calls in small, improvised groups, organized around business lines. Companies have asked for more organization and structure. They are looking for broad industry participation in an information-sharing arrangement that is timely and actionable.

LIMRA and LOMA are in a unique position to help. Many fraud-related technologies are on the market, especially related to cyber security. But no technology company can replicate LIMRA’s and LOMA’s ability to bring industry participants together to share information to fight fraud.
Our gratitude goes out to American Family, John Hancock, MassMutual, Securian Financial, T. Rowe Price, USAA, and their teams, as well as the LIMRA-LOMA team, for their outstanding efforts in this fraud prevention effort. We are stronger (and more innovative) together.